Investors budget for low rental yields
22/02/2010
Property investors looking to buy in 2010 will be counting on capital gains because rental yields are low.
According to RP Data, Sydney houses are providing a gross rental yield of 4.2 per cent and Sydney units 5.1 per cent. Melbourne houses are returning gross yields (before costs) of 3.7 per cent — the lowest in the country — and Melbourne units are yielding 4.3 per cent.
With interest rates expected to continue to rise over the coming year, investors and first-home buyers would do well to build a margin of safety into their calculation of how much they should borrow, says the chief executive of financial comparison site Infochoice.com.au, Shaun Cornelius.
Source: Sydney Morning Herald
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